DECEMBER 2016 • COUNTRY LIFE IN BC Farmers see potential in CETA trade deal Stories by DAVID SCHMIDT
OTTAWA – The Canadian Federation of Agriculture and most non-supply managed agricultural commodities were united in welcoming the new Comprehensive Economic and Trade Agreement (CETA) with the European Union (EU). Prime Minister Justin Trudeau and European Council president Donald Tusk signed the trade deal in Brussels on October 30.
The deal, seven years in the making, is the first multilateral trade deal signed by the EU and another nation. With the recent election of Donald Trump as US president and protectionism running rampant south of the border, it could be years before the US reaches a similar deal with the EU. Trump’s election also puts the Trans-Pacific Partnership, another trade deal welcomed by almost all of Canadian agriculture, in serious jeopardy.
When fully implemented, CETA will remove tariffs from 94% of Canadian agriculture and agri-food products exported to the EU.
CFA president Ron Bonnett called CETA “a very positive step” that could allow Canadian agricultural exporters to capture significant business
opportunities throughout the EU's 28 member countries
because of the market access concessions which were negotiated.
Beef and pork producers were particularly effusive in their praise of the deal. Canadian Pork Council chair Rick Bergmann notes the agreement will secure tariff- free access for Canadian processed pork products in Europe. The Canadian pork industry will acquire a quota volume equivalent to 80,000 tonnes of pork cuts after a five year phase-in period. “We look forward to the government officials resolving the outstanding technical barriers that limit our ability to capitalize on what was achieved,” Bergmann said. Although very little, if any, BC pork is exported, new BC Hog Marketing Commission general manager Mike Wallis noted that anything that helps to increase returns for pork producers in the rest of the country will have a positive impact for BC producers.
The Canadian Cattlemen’s Association (CCA) noted that it has been “a long-time champion of the CETA” and is “pleased with the prospective elimination of EU import tariffs on nearly 65,000 tonnes of Canadian beef.”
It says the new access gives the EU the potential to become a $600 million annual market for Canadian beef, up
from current levels of $6 to $10 million per year.
“Beef access to the EU is a core expected benefit from Canada and we will expect a further effort to be put into removing the remaining technical barriers,” CCA director and foreign trade vice-chair Doug Sawyer said. BC cattle producers are particularly hopeful of gaining significant benefits from the deal. Europe is the world’s largest market for grass-fed beef, something more and more BC ranchers are focusing on.
Dairy fears
Dairy farmers in both Canada and the EU are not as ecstatic. In fact, signing of the deal was held up for several weeks as the Belgian region of Wallonia refused to give its approval for the agreement. That refusal was based on an intense lobby from its dairy producers who feared they could lose production as a result of it.
Canadian dairy farmers have the same fears since CETA provides tariff-free access for an additional 17,700 tonnes of European cheese annually. Dairy Farmers of Canada says “the market access granted in CETA will cost Canadian dairy farmers as much as $116 million in lost milk sales each year.”
Money for dairy
OTTAWA – On November 10, the federal government moved to allay some of the concerns Canadian dairy farmers have about the Comprehensive Economic and Trade Agreement (CETA), announcing a $350 million mitigation package for dairy producers and processors. It is providing $250 million over five years for a Dairy Farm Investment Program that will help Canadian dairy farmers update farm technologies and systems and improve productivity through upgrades to their equipment. This could include the adoption of robotic milkers, automated feeding systems and herd management tools. It is also providing $100 million over four years for a Dairy Processing Investment Fund to help dairy processors modernize their operations and diversify their products to pursue new market opportunities. Federal agriculture minister Lawrence MacAulay called the two new programs “a major infusion of cash for one sector,” insisting it shows the government’s commitment to supply management.
Dairy Farmers of Canada president Wally Smith called the announcement “a significant step in demonstrating (government’s) commitment to supply management, and to the continued innovation and growth of Canada’s dairy sector.”
However DFC director Bruno Letendre notes the two programs do not address DFC’s issues with Canada’s domestic regulations nor the continued leakage of diafiltered milk and other milk ingredients across the border. While MacAulay acknowledged the concerns, calling diafiltered milk “an issue I inherited,” he believes the issue is abating, claiming the amount of diafiltered milk coming across the border has been decreasing.
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